Canadian Solar Inc. ("Canadian Solar" or the "Company") (NASDAQ: CSIQ), one of the world's largest solar power companies, today announced its financial results for the quarter ended September 30, 2017.
Third Quarter 2017 Highlights
- Total solar module shipments were 1,870 MW, compared to 1,745 MW in the second quarter of 2017, and the third quarter guidance in the range of 1,650 MW to 1,700 MW.
- Net revenue was $912.2 million, compared to $692.4 million in the second quarter of 2017, and the third quarter guidance in the range of $805 million to $825 million.
- Net revenue from the total solutions business as a percentage of total net revenue was 21.6% compared to 6.5% in the second quarter of 2017.
- Gross margin was 17.5%, compared to gross margin of 24.2% in the second quarter of 2017 (including the benefits of two AD/CVD reversals of $42.6 million and $15.0 million based on the final rates of Solar 1 AR3 and Solar 2 AR1, respectively) and gross margin of 15.9% in the second quarter of 2017 (excluding the reversal benefits), and the third quarter guidance of 15.0% to 17.0%.
- Net income attributable to Canadian Solar was $13.3 million, or $0.22 per diluted share, compared to net income of $38.2 million, or $0.63 per diluted share, in the second quarter of 2017.
- Cash, cash equivalents and restricted cash balance as of September 30, 2017 was $1.15 billion, compared to $961.6 million as of June 30, 2017.
- Net cash provided by operating activities was $153.8 million, compared to net cash used in operating activities of $83.4 million in the second quarter of 2017.
- The Company's portfolio of solar power plants in commercial operation was 1,419.5 MWp as of September 30, 2017, with an estimated total resale value of approximately $2.0 billion. Only the class B share value of the Company's tax equity deal projects in the U.S. was included in the estimated resale value.
Update on the Monetization of the Operating Projects
- In September and October 2017, the Company entered into definitive agreements with two Asian buyers, to sell a portfolio of six solar power projects in California, totaling 703 MWp. These transactions are subject to various government approvals. The parties hope to close the transactions in the fourth quarter of 2017 or the first quarter of 2018, depending on the timing of the required governmental approvals.
- In September 2017, Canadian Solar Infrastructure Fund, Inc. ("CSIF"), a fund sponsored by a subsidiary of the Company, obtained approval from the Tokyo Stock Exchange, Inc. (the "TSE") to list its investment units on the TSE's infrastructure investment fund securities market. Japanese subsidiaries of Canadian Solar agreed to sell 13 operating solar power plants with a total installed capacity of 72.7 MWp to CSIF as its initial portfolio (the "Initial Portfolio"). An initial public offering of 177,800 CSIF investment units was priced at 100,000 Japanese yen per unit, before underwriting discounts. Of the units included in the offering, Canadian Solar purchased 25,395 units as the designated purchaser. The listing was completed on October 30, 2017. CSIF plans to use the net proceeds from the offering and anticipated bank borrowings of JPY 17.7 billion (approximately $156 million) to consummate the acquisition of the Initial Portfolio. Net sale proceeds to Canadian Solar from the Initial Portfolio amounted to JPY 30.4 billion (approximately $270 million). Canadian Solar expects to use part of the net sale proceeds to reduce its overall debt by JPY 18.7 billion (approximately $165 million).
- In September 2017, the Company entered into an agreement to sell 99 percent of its Class B membership interests in the 92 MWp IS-42 project in North Carolina to Falck Renewables S.p.A., with closing expected in November 2017.
- In October 2017, the Company entered into agreements to sell interests in three solar projects in Australia, totaling 117 MWp, to Foresight Solar Fund Limited. The transaction is expected to close in the fourth quarter of 2017.
- During the quarter, the Company completed the sale of the 108 MWp SECI Maharashtra project in India.
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